VOIP EQUIPMENT PURCHASE AND SERVICES AGREEMENT
Exhibit
10.20
THIS
AGREEMENT is made and entered into on this _25
th_
day of October, 2006, by and between Onasi, Inc., a Utah corporation dba OnSat
(“OnSat”) with its principal offices in Park City, Utah, and Viper Networks,
Inc., a Nevada corporation (“Viper”) with its principal offices in San Diego,
California. (The forgoing are at times herein referred to collectively as the
“Parties.”)
R
E C I T A L S
A. OnSat
is engaged in the business of designing, installing and servicing
satellite-based Internet services and related equipment in remote domestic
and
international locations, and is currently authorized and contracted to provide
those services to residents of the Navajo Nation under contract no. C22052
Master
Agreement Internet and Transmission Services
dates 11-30-01 as modified under modification no. 10 dated 1-15-06. OnSat is
interested in expanding its Internet-based services within the Navajo Nation
(the “Territory”) to include telecommunication services using
Voice-Over-Internet protocol;
B. Viper
is engaged in the business of designing and marketing Voice over Internet
Protocol (“VOIP”) products and services and is interested in expanding its
subscription market and related services into the Navajo Nation and desires
to
engage with OnSat as its exclusive reseller of those services within that
market, with the potential for expansion into other OnSat service
markets.
C. OnSat
desires to engage with Viper as its sole-source provider of VOIP products and
services within the Navajo Nation market, with the potential for further market
expansion.
D. The
parties have heretofore agreed on the material terms of an agreement between
them, to the foregoing purposes and desire now to formalize that agreement,
on
the terms and conditions herein.
NOW,
THEREFORE, in consideration of the foregoing and the mutual agreements and
covenants contained herein, the Parties hereby agree as follows:
1.
Effective
Date and Initial Term.
This Agreement shall be effective as of ___
10-25-06_______
or, if later, the date on which Viper obtains commitments for loan financing
in
amounts sufficient to finance the purchase of equipment necessary hereto, which
amount is estimated to be not less than the amount provided on Exhibit 1, Item
1
(the “Viper Financing”). The Initial Term hereunder shall expire on June 30,
2010, and shall renew for successive one-year terms unless either party shall
notify the other, in writing, not later than 90 days prior to the end of the
Initial Term (or any extension then in effect), of its desire to terminate.
Notwithstanding the forgoing, the Initial Term shall expire upon any termination
of OnSat’s contract C22052 with the Navajo Nation prior to the date set forth
herein, provided said termination is not due to the default or breach of the
contract by OnSat.
2.
Financing
as a Condition Precedent.
The parties understand and acknowledge that the Viper Financing referenced
in
paragraph 1 is a condition precedent to the parties’ respective obligations
hereunder and that, in the event of Viper’s inability to obtain such financing
commitment within thirty
1
(30)
days of the date hereof, despite the exercise of commercially reasonable
efforts, either party may terminate this agreement and shall rescind and return
any transfer of property hereunder.
3.
Viper
As Exclusive VOIP Provider.
For the term of this Agreement, as extended or renewed hereunder, and provided
that Viper shall provide functional and serviceable VOIP services within the
Territory, OnSat shall contract exclusively with Viper for such services and
shall neither promote nor market nor represent any VOIP service or products
similar to those offered by Viper without Viper’s prior written consent.
Similarly, and for said term, Viper shall contract exclusively with OnSat and
shall neither act to interfere with, compete with or circumvent OnSat’s
contractual relationship with the Navajo Nation and with actual or potential
subscribers within the Territory. The parties agree that each shall also afford
the other a reasonable right of first refusal to join in a similar agreement
in
connection with other remote, satellite-based Internet markets in which both
are
or have the potential for market expansion before contracting with others to
provide equipment or services in connection with such expansions or new
markets.
4.
Purchase
and Maintenance of Equipment In Place.
a.
Access
Point Equipment Purchased.
Viper hereby agrees to purchase from OnSat and OnSat agrees to sell to Viper
various Wireless service base equipment (“Access Equipment”) currently
installed, in place and operational within the Territory and necessary to the
VOIP services, comprising 900 MHz access points, related server equipment and
antennas, as identified and itemized in greater detail at Schedule 1(a) attached
hereto.
b.
Purchase
Price.
Viper agrees to pay to OnSat a total of $1,411,000.00 for the Access Equipment,
which amount shall be payable in authorized common shares of Viper (OTC: VPER),
at exchange rate equal to the average closing price of publicly-traded VPER
shares over the 30-day period preceding the Effective Date of this Agreement
or
in preferred shares of Viper convertible into the same number of common shares
(the “Viper Shares”). OnSat acknowledges and understands that said shares are
restricted from public sale in accordance with applicable SEC rules and
regulations and may not be readily marketable for an indefinite period. The
Viper Shares will be split between two certificates; one for 10,000,000 (ten
million) common shares (the “Retained Shares”) and the second for the balance of
the Viper Shares previously calculated (the “Resale Shares”); collectively the
“Viper Shares.”
c.
Documentation
and Rescission Upon Failure of Condition.
The purchase and sale of the Access Equipment under this paragraph shall be
documented by a Xxxx of Sale itemizing all Access Equipment. Notwithstanding,
in
the event that Viper is unable to obtain the Viper Financing as provided in
paragraph 1 above, said sale shall be reversed and rescinded, and OnSat shall
return to Viper, in exchange for Viper’s return of the Xxxx of Sale, the Viper
Shares received in connection with said purchase transaction.
d.
Equipment
Maintenance and Use.
OnSat shall be responsible to service, maintain, and replace all Access
Equipment, as required to maintain service to the Territory, for Viper, and,
in
consideration of such continued maintenance and service, and in further
consideration for the VOIP rates paid to Viper hereunder, OnSat shall have
continued rights and license to use said Access Equipment to provide OnSat’s
Internet connectivity and services within the Territory (the “OnSat Territory
License”).
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OnSat
shall provide to Viper regular reports of the serviceability of the Access
Equipment and shall timely advise of the failures of reasonable repairs and
any
resulting replacement.
e.
Risk
of Loss.
The risk of loss and responsibilities to insure the Access Equipment shall
remain with OnSat for the life of this Agreement as additional consideration
for
the OnSat Territory License. Upon the execution and delivery to Viper of the
Xxxx of Sale hereunder, and prior to the Viper Financing funding, OnSat shall
deliver to Viper an original certificate of insurance naming Viper and the
Viper
Financing lender(s) as additional named insured.
f. Property
Taxes and/or Use Taxes.
OnSat shall be responsible for the payment of all property and/or use taxes
accessed on the Access Equipment as additional consideration for the OnSat
Territory License.
g. Resale/Repurchase
of Access Equipment.
Viper has the right and option, at its sole choice, to resell the Access
Equipment (subject to adjustment for repairs and replacements of said equipment
under subparagraph (d) above) back to OnSat on June 30, 2010 or, at Viper’s
option, such earlier date as 27,000 VOIP users have active subscriptions within
the Territory. For its part, OnSat has the right and option, at its sole choice,
and in consideration of the surrender of the Resale Shares, to repurchase the
Access Equipment from Viper subject to the terms of the Viper Financing, at
any
time after June 30, 2008 or upon any earlier of any of the following
occurrences: (i) Viper bankruptcy; (ii) Viper’s default under this Agreement; or
(iii) any reduction or dilution of the market value of Viper shares for a
consecutive period of 90 days below 50% of the valuation upon which the purchase
price for the Access Equipment was calculated. In the event of the exercise
by
either party of the options granted herein, OnSat agrees to return or to cause
to be returned to Viper the Resale Shares received in subparagraph (b) above
and
Viper agrees to provide to OnSat a Xxxx of Sale for the Access Equipment. Viper
and OnSat agree that the stock certificate representing the Resale Shares and
a
Xxxx of Sale reconveying the Access Equipment to OnSat will be held in escrow
by
Snow, Xxxxxxxxxxx & Xxxxxxxxx (“Snow”) until such time as either party shall
exercise the option granted to it hereunder, or until each has waived its rights
to do so, in writing. In the event of an exercise by either party of the option
to resell or repurchase the Access Equipment and upon delivery to Snow and
to
the other party of written notice of that exercise, Snow will return the Resale
Share certificate to Viper and deliver the Xxxx of Sale to OnSat.
Notwithstanding the foregoing, Viper’s option to resell the Access Equipment and
OnSat’s option to repurchase the Access Equipment shall expire as of July 10,
2010, at which time the Resale Share certificate will be released into OnSat’s
possession and the Xxxx of Sale shall be returned to Viper
5.
VOIP
Subscriber Services on OnSat Network
a. Viper’s
VOIP products and services (the “VOIP Services”) will be marketed and sold
within the Territory through OnSat, under it current and exclusive contract
with
the Navajo Nation. For that purpose, Viper appoints OnSat as its sole and
exclusive reseller of Viper VOIP Services within the Territory, and on the
terms
and conditions outlined herein. OnSat shall also be Viper’s sole source for all
required subscriber equipment, which shall be compatible with the Access
Equipment, and provided at the prices provided herein.
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b. Viper
will initially purchase from OnSat and OnSat shall maintain for use in
connection with the sale and delivery of Viper’s VOIP Services within the
Territory, the number of VOIP subscriber kits and at a unit cost as provided
on
Exhibit 1, Item 5(b) and comprising the following (collectively, the “Subscriber
Equipment”):
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i.
|
900
MHz modem
|
| ii. | VOIP Broadband Phone Adaptor (“BPA”) box (LlnkSys model no. 2102 or equivalent as tested by Viper) |
| iii. | Subscriber-side antenna |
| iv. | Cabling |
| v. | VOIP Services, and |
| vi. | Standard telephone handset (as required) |
c. From
and after Viper’s purchase of the Subscriber Equipment (the “Inventory”), Viper
shall own all such equipment; however, OnSat shall maintain and protect said
Inventory until installation is accepted by the subscriber, to be used for
subscriber installations.
d.
Viper’s obligation to purchase Subscriber Equipment is limited to the quantities
and dates, as detailed in the attached as Schedule 5(d). If installations would
exceed these Inventory levels OnSat, at its option, will either:
|
i.
|
Fund
the purchase of additional Inventory, until the next scheduled
Viper
purchase, to satisfy all or part of the additional sales demand,
or
|
| ii. |
Delay
the installation of new Subscriber Equipment until he next Inventory
purchase by Viper.
|
6.
Service
Wholesale Rates, Commissions, Marketing Costs:
The parties agree to the following rates and commissions to apply for the
Initial Term. Said rates may be adjusted thereafter upon annual renewals upon
the written consent and agreement of both parties.
a. From
subscriber charges for VOIP services, OnSat shall pay to Viper the following
for
each subscriber:
i. the
amount provided on Exhibit 1, Item 6(a)(i) for each installation under a two
(2)
year VOIP services contract of Subscriber Equipment as collected, such
installation fee will generally be paid by the Navajo Communities/Navajo Nation
under OnSat’s Sole Source Agreement with the Navajo Nation;
ii. the
monthly amount provided on Exhibit 1, Item 6(a)(ii) for each monthly billed
unlimited (as defined) subscription services account (the “Monthly Account”) in
advance on the 5th
of each month for unlimited (as defined) monthly calls within the continental
US
(48 states);
iii. the
amount provided on Exhibit 1, Item 6(a)(iii) per minute for prepaid phone card
sales, for other than unlimited calling plans, and for excess unlimited average
usage (as defined)
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for
actual continental US usage, billed by the minute, as such card sales are made
or usage incurred in arrears on the 5th
of each month;
iv. the
percentage provided on Exhibit 1, Item 6(a)(iv) of Viper’s published rates for
all calls made outside of the continental US, billed by the minute, as such
card
sales are made or usage incurred in arrears on the 5th
of each month; and
v. the
amount provided on Exhibit 1, Item 6(a)(v) for the early cancellation of a
Monthly Account in arrears on the 5th
of each month.
b. In
turn, Viper shall pay to OnSat the following by the 5th
of each month:
vi. a
flat monthly fee of the amount provided on Exhibit 1, Item 6(b)(vi) for
marketing and sales services for the first twelve (12) months of the Initial
Term following funding of the Viper Financing, then 50% of the amount provided
on Exhibit 1, Item 6(b)(vi) per month until the last twelve (12) months of
the
Initial Term then zero (the “Marketing Fee”). Upon renewal(s) of this Agreement
the Marketing Fee of 50% of the amount provided on Exhibit 1, Item 6(b)(vi)
per
month will be reinstated until the last twelve (12) months of the Renewal Term
then zero;
vii. the
monthly amount provided on Exhibit 1, Item 6(b)(vii) for each monthly unlimited
subscription services account for use of OnSat satellite bandwidth in advance
on
the 5th
of each month;
viii. a
the percentage provided on Exhibit 1, Item 6(b)(viii) commission on the Viper’s
net monthly subscription services revenue (6(a)(ii) minus 6(b)(vii) for OnSat’s
sales, engineering and customer support services in advance on the 5th
of each month; and
ix. a
the percentage provided on Exhibit 1, Item 6(b)(ix) commission on Viper’s
monthly revenue billed under 6(a)(iii) and 6(a)(iv) above in arrears as
additional consideration for OnSat’s sales, engineering and customer support
services.
c. The
term unlimited subscription services account refers to the contract between
OnSat and the individual subscriber not the delivery of the aggregate
continental US calling minutes during a month for these individual subscribers
as paid by OnSat to Viper. For the purpose of this Agreement between Viper
and
OnSat additional usage minutes, as defined below, will be paid to Viper as
follows:
x.
individual subscriber continental US minutes in excess of the number of minutes
provided on Exhibit 1, Item 6(c)(x) during a monthly billing cycle will be
paid
at the amount provided on Exhibit 1, Item 6(c)(x) per minute in arrears on
the
5th
of each month; and
xi. the
aggregate continental US minutes provided to all subscriber’s during a month in
excess of the product of the number of minutes provided on Exhibit 1, Item
6(c)(xi) times the numbers of subscribers during the month will be paid at
the
amount provided on Exhibit 1, Item 6(c)(xi) per minute in arrears on the
5th
of each month.
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d. Any
applicable sales, use, personal property, excise or other taxes (other than
income or corporate franchise taxes) which attach to the sales of the VOIP
services or which OnSat is required to pay or collect on or as a result of
the
rights granted hereunder shall be the sole responsibility of OnSat, which shall
hold Viper harmless therefrom. Viper shall be responsible for any property
tax
attaching to equipment owned by Viper, excluding the Access Equipment, and
the
unsold Inventory and all such liability shall be deemed to be included in the
rates payable hereunder.
e. All
payments and allowances payable between the parties shall be shall be calculated
and reconciled by the parties quarterly on a calendar basis.
7.
Services
Installation and Marketing.
In consideration of the rates and payments between the parties as outlined
in
this Agreement, the parties shall bear responsibility for marketing, selling,
promoting, installing and servicing Viper’s VOIP services and equipment for
subscribers on OnSat’s existing satellite-based Internet network and related
system within the Territory, as follows:
|
a.
|
Viper
Duties.
|
i. Viper
shall provide provisional interface for the VOIP network and other
interconnection with OnSat’s satellite network and all software necessary to
provide required subscriber connectivity to Viper’s network, with related online
support.
ii. Viper
shall provide sales terminal VOIP Services interface for OnSat employees to
assist them in collection the customer information and payment
data.
ii. Viper
shall provide US and or International long distance termination for OnSat’s
network VOIP subscribers.
iii. Viper
shall provide free online billing for all subscribers. Optional paper billing
will be available at an additional cost of the amount provided on Exhibit 1,
Item 7(a)(iii) per month per subscriber.
iv. Viper
shall provide updates and level 2 and level 3 tech support, as generally
described in Schedule 7(a)(iv) attached hereto.
v. Viper
will cooperate fully with OnSat’s efforts to promote, install and maintain
Viper’s products and services within the Territory.
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b.
|
OnSat’s
Duties.
|
i. OnSat
shall be responsible to install the Subscriber Equipment and to provide VOIP
subscribers with interconnection between the subscriber’s premise to OnSat’s
satellite
network.
ii. OnSat
shall be responsible for provide level one technical support (for VOIP Services)
including installation and service of the Subscriber Equipment, as that support
is described in Schedule 7(b)(ii) hereto.
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iii. OnSat
shall be responsible to maintain its satellite network and provide an internet
connection to VOIP subscribers.
iv. OnSat
shall be responsible to collect all VOIP revenue from subscribers and to
determine each subscriber’s credit worthiness and to pay VIPER at OnSat rates
and at such times as provided herein.
v. OnSat
shall use its best efforts to promote and to seek orders for the VOIP Services
from existing subscribers for OnSat’s services and from other potential
subscribers within the Territory.
vi. OnSat
shall provide quarterly forecasts of expected future sales on a calendar
basis.
vii. OnSat
shall perform its duties hereunder with reasonable care and skill and shall
cultivate and maintain good relations with subscribers and potential subscribers
in accordance with sound commercial principles.
viii. Except
as otherwise specifically provided in this Agreement OnSat shall perform its
duties hereunder at its own cost and expense, in consideration of the monthly
payments made by Viper hereunder, and otherwise in such manner in accordance
with sound commercial principles.
ix. OnSat
shall make reasonable efforts to inform Viper of all laws and regulations in
the
jurisdiction(s) into which the Territory falls from time to time relating to
the
VOIP Services and shall forthwith notify Viper if it becomes aware that the
arrangements set out in or contemplated by this Agreement are or may be in
breach of any such laws or regulations. As of the date of this Agreement OnSat
is not aware of any facts or circumstances which would be disclosed in
accordance with the proceeding duty.
x. OnSat
shall have rights and license to include and incorporate Viper logos and
trademarks in OnSat’s promotional materials within the Territory as appropriate
and in accordance with current Viper style and consistent with Viper’s trademark
use policies. All such use of Viper logos and trademarks must have specific
prior written approval by Viper.
xi. OnSat
agrees to display Viper’s logo and trademarks in appropriate places on all VOIP
equipment. Further, OnSat agrees to place notice of any copyright and patent
protection or other proprietary legend requested by Viper on relevant products
or literature.
xii. All
advertising and promotional materials prepared by OnSat and relating to or
otherwise referencing Viper VOIP services shall be submitted to Viper for
approval and not used until such approval shall be obtained, which approval
shall not be unreasonably withheld.
xiii. OnSat
shall promptly inform Viper forthwith of each and any of the following of which
OnSat is or becomes aware within the Territory:
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|
•
|
any
complaint concerning the VOIP
Services;
|
|
•
|
any
actual or suspected breach by an Subscriber of the terms and conditions
of
its VOIP Subscriber Agreement;
|
|
•
|
any
matters likely to be relevant in relation to the development promotion
licensing use or maintenance of the VOIP Services;
and
|
|
•
|
any
infringement by any third party of Viper’s rights in the VOIP Services and
underlying software or firmware.
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xiv. For
at least two (2) years after the relevant installations, OnSat will retain
records adequate for Viper to verify the accuracy of OnSat’s reports and
payments. Viper shall have the right to audit and copy such records upon not
less than fifteen (15) days prior notice to OnSat, such audit to be performed
by
such auditors and/or employees as Viper shall desire in its sole discretion.
In
the event that any such audit shall reveal a deficiency in royalty payments,
then OnSat shall immediately pay to Viper the total amount of said deficiency
plus interest at the monthly rate as published by the Federal Reserve Board
from
time to time for monthly Bank Prime Loan. In the event such deficiency is equal
to five percent (5%) or more of the royalties set forth in the most recent
royalty report, or if OnSat is in default hereunder, then OnSat shall also
pay
to Viper the cost of such audit. In the event that an audit reveals the OnSat
has overpaid required royalty payments, the total of such overpayment shall
stand as an immediate credit and offset against any sums next due from OnSat
to
Viper. The provisions of this paragraph 4(d) shall survive expiration or
termination of this Agreement.
8. Restrictions
on Marketing Rights.
Except as herein specifically provided otherwise, OnSat’s marketing rights
hereunder shall be subject to the following restrictions:
a. OnSat
shall not license or sub-license or enter into any contracts for the licensing
or sub-licensing of the VOIP Services on behalf of Viper or to bind Viper in
any
way without prior written consent by Viper;
b. OnSat
shall have the right to license or sub-license or enter into any contracts
for
the licensing or sub-licensing of the VOIP Services on behalf of Viper with
any
wholly owned subsidiaries;
c. OnSat
shall not hold itself out or permit or suffer any person to hold itself out
as
being authorized to bind Viper in any way;
d. OnSat
shall not pledge the credit of Viper in any way;
e. OnSat
shall not use any promotional or advertising materials in relation to the VOIP
Services except those approved by Viper;
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f. OnSat
shall not engage in any conduct, which in the reasonable opinion of Viper is
prejudicial to Viper’s business or the commercial exploitation of the VOIP
Services;
g. OnSat
shall not give or pass on any warranties on behalf of Viper other than the
warranties specifically set forth in the Subscriber Agreement (or any amendment
or replacement thereof from time to time prescribed by Viper)
h. OnSat
shall not copy, reproduce or transmit in any form or by any means the VOIP
Services software or any part thereof or permit any third party to do
so.
9. Proprietary
Rights.
a. Each
party shall retain and control full ownership and title to its respective system
software (“Viper Programs” and “OnSat Programs,” respectively). Title to each
(including any customizations, modifications and ports thereof) in any form
shall at all times remain exclusively with the original owner thereof, which
ownership shall not be affected or altered by virtue of this Agreement or the
parties’ cooperation hereunder. Under no circumstances shall either party
attempt, or permit others to attempt, to decompile, disassemble or otherwise
reverse engineer the programs of the other.
b. Each
party shall take reasonable steps to safeguard the programs and proprietary
information of the other, exchanged under this Agreement, and to assure that
no
unauthorized persons have access to them and that no person authorized to have
access to any of them takes any action with respect thereto which is herein
prohibited.
c. OnSat
shall include, and shall not alter or remove, any applicable copyright, patent,
trade secret, trademark or other proprietary notices on all copies (in whatever
form) of the Viper Programs and the packaging in which they may be contained.
All use by OnSat of Viper’s trademarks shall be in accordance with Viper’s
published trademark usage guidelines. Nothing herein shall be deemed to limit
or
restrict OnSat’s rights to brand its own services or any elements or features
thereof with its own name or identification, provided that there is no confusion
between such names and any trademark owned by Viper.
d. The
terms of this Agreement are confidential and may not be disclosed to third
parties. The parties hereby acknowledge that this Agreement establishes a
relationship of confidentiality between them, and OnSat acknowledges that the
Viper Programs are furnished by Viper on a confidential basis. Unless otherwise
agreed to in writing by Viper, OnSat shall limit access to the Viper Programs
to
its employees and agents and subcontractors under commitments of non-disclosure
and on a need-to-know basis only. Such access shall be solely for the purpose
of
enabling OnSat to Use the Viper Programs for the limited purposes set forth
in
this Agreement.
10. Exclusive
Limited Warranty of Viper Products:
a. Viper
warrants that the Viper Programs will upon delivery substantially conform to
the
description thereof in Viper marketing literature.
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b. As
the sole and exclusive remedy for breach of the warranty contained in the
preceding subparagraph, Viper will provide the support services set forth in
Schedule 7(a)(iv) hereof. In the event that Viper fails to provide the required
support, it shall refund to OnSat the net amount paid by OnSat under this
Agreement for the Viper Programs as depreciated on a straight-line method,
using
a useful life of two (2) years, and otherwise excuse future fees to be paid
or
accrued during the term of this Agreement then in effect until Viper provides
a
remedy.
c. Viper’s
exclusive limited warranty provided for in this Section 10 shall not apply
to
damage or deficiencies to the Viper Programs resulting from accident,
alteration, modification, foreign attachments, misuse, tampering, negligence,
improper maintenance, abuse or failure to implement any Updates furnished
pursuant to this Agreement.
d. Viper
reserves the right to make substitutions and modifications in the specification
of the Viper Programs, provided that such substitutions or modifications will,
in Viper’s sole opinion, improve performance of the Viper Programs.
e. Viper
shall, at its cost and expense, defend, indemnify and hold OnSat harmless from
and against any claim (including, but not limited to, a claim for personal
injury or property damage) by any other person or party arising out of or in
connection with the use of the Viper Programs as a part of OnSat’s services,
regardless of whether such claim is founded in contract, tort or warranty.
11. Exclusive
Limited Warranty of OnSat Products:
a. OnSat
warrants that the OnSat satellite network delivery of internet service will
substantially conform to the description thereof in OnSat marketing
literature.
b. As
the sole and exclusive remedy for breach of the warranty contained in the
preceding subparagraph, OnSat will provide the support services set forth in
Schedule 7(b)(ii) hereof. In the event that OnSat fails to provide the required
support, it shall refund to Viper the amount paid by Viper under this Agreement
for the OnSat satellite network for the prorated monthly fee and otherwise
excuse future fees to be paid or accrued during the term of this Agreement
then
in effect until OnSat provides a remedy.
c. OnSat
reserves the right to make substitutions and modifications in the specification
of the satellite network, provided that such substitutions or modifications
will, in OnSat’s sole opinion, improve performance of the OnSat satellite
network.
d. OnSat
shall, at its cost and expense, defend, indemnify and hold Viper harmless from
and against any claim (including, but not limited to, a claim for personal
injury or property damage) by any other person or party arising out of or in
connection with the use of the OnSat satellite network as a part of VOIP
Services, regardless of whether such claim is founded in contract, tort or
warranty.
12. Patents
and Copyrights.
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a.
Viper
will defend and indemnify OnSat against any claim that Viper Programs delivered
hereunder, or the use thereof, constitute an infringement of a currently
effective patent, copyright, trade secret or other intellectual property right
in the United States, Canada, Europe or Japan. Viper’s obligations hereunder
will only apply if OnSat notifies Viper promptly in writing as to any such
claim; gives Viper the right to control and direct the investigation,
preparation, defense, trial and settlement of each such claim; and provides
Viper with information deemed necessary by Viper or its counsel in connection
with the foregoing. OnSat agrees to cooperate fully with Viper in the defenses
and/or settlement of each such claim. If Viper receives notice of an alleged
infringement or if the use of Viper Programs is prevented based on an alleged
infringement, Viper will have the right, at its option, to obtain for OnSat
the
right to continued use of any such Viper Programs; substitute other comparable
programs that deliver equivalent or better functionality and performance; or
replace or modify such Viper Programs or their design so that they are no longer
infringing. If, in Viper’s opinion, none of the foregoing alternatives is
reasonably available to Viper, then Viper may remove such Viper Programs and
pay
to OnSat a sum equal to the net amount paid by OnSat under this Agreement for
the Viper Programs as depreciated on a straight-line method, using a useful
life
of two (2) years. In no event shall Viper’s liability under this paragraph
(excluding Viper’s outside counsel fees and internal costs) exceed the amount
paid by OnSat to Viper for the Licensed Program(s) which includes the alleged
infringement. The foregoing states the entire liability of Viper with respect
to
infringement of any patents, copyrights or other intellectual property rights
by
Viper Programs.
b. Viper’s
obligation contained in the preceding subparagraph does not extend to any suit
or proceeding which is based upon a patent claim covering a combination of
which
any Licensed Program licensed under this Agreement is merely an element of
the
claim combined with other devices or elements not acquired hereunder unless
(and
only to the extent) Viper is a contributory infringer, nor does it extend to
use
of any Licensed Program in a manner not permitted or contemplated in Viper’s
published documentation.
13. Termination:
a. Either
party may terminate this Agreement for cause prior to the expiration of the
Initial Term (or any extension then in effect) after delivering written notice
to the other party, in the event the other party defaults in performance of
any
of its material obligations under this Agreement unless such default is cured
within 30 days after receipt of such notice. It shall be an event of default
for
either party to file for bankruptcy protection, voluntarily or involuntarily.
b. The
parties’ respective obligations to reconcile and make payments due hereunder as
of the date of termination shall survive any expiration or termination of this
Agreement.
14 General
Provisions:
a.
This
Agreement will not be binding upon either party until signed by authorized
officers or representatives and accompanied by a signed Corporate Resolution
of
OnSat and Viper.
11
b. OnSat
may not assign this Agreement other than to a subsidiary of OnSat, without
the
prior written consent of Viper.
c. This
Agreement shall be governed by and construed in accordance with the laws of
the
State of Utah. Without limiting the foregoing, this Agreement shall be governed
by the Uniform Commercial Code. The transactions which are the subject matter
of
this Agreement shall be deemed to be a “transaction in goods” and all VOIP
products, including software shall be deemed to be “goods” within the meaning of
the said statute, even if title and ownership of equipment and VOIP-related
software is retained by Viper. To the extent, if any, that services are provided
in connection with this Agreement, such services shall be deemed incidental
to
the provisions of “goods”.
d. Interest
shall accrue on any net payments past due by either party to the other
hereunder, at the monthly rate of one and one-half percent (1-1/2%) or at the
maximum legal rate, whichever is less. Nothing contained in this paragraph
shall
be deemed a waiver of the termination provisions of this Agreement in the event
of either party’s default hereunder.
e. No
failure or delay on the part of either party in exercising any right or remedy
provided in this Agreement shall operate as a waiver thereof; nor shall any
single or partial exercise of or failure to exercise any such right or remedy
preclude any other or further exercise thereof or the exercise of any other
right or remedy under this Agreement.
f. Both
parties may issue press releases, the language of which shall be subject to
the
approval of the other party, announcing the relationship and intended benefits
and availability of the Viper Products within the Territory.
g. Any
notice required or permitted under this Agreement shall be in writing and shall
be sent to the following (unless notice of a changed address has been
given):
If
to OnSat:
Onasi,
Inc.
Attn:
Xxxxx Xxxxxxxx, CEO
000
Xxxxx Xxx. Xxx. 000
X.X.
Xxx 000000
Xxxx
Xxxx, XX 00000
Voice:
(000) 000-0000
Fax:
(000) 000-0000
e-mail:
Xxxx@xxxxxxxx.xxx
12
With
a copy to:
Xxxxx
X. Xxxxxxxxx, Esq.
Snow,
Xxxxxxxxxxx & Xxxxxxxxx
00
Xxxxxxxx Xxxxx, 00xx
Xxxxx
X.X.
Xxx 00000
Xxxx
Xxxx Xxxx, Xxxx 00000-0000
Fax:
(000) 000-0000
e-mail:
xxxxxxxxxx@xxxxxx.xxx
If
to Viper:
Viper
Networks, Inc.
Attn:
Farid Shouekani, CEO
000
Xxxxxxxxxx Xxx, Xxxxx 000
Xxxx,
XX 00000
Fax:
(000)000-0000
e-mail.
XxxxxXxxxxxxxx00@xx.xxx
With
a copy to:
Viper
Networks, Inc.
Attn:
Xxxx Xxxxxx, CFO
00000
Xxxxxxx Xxxxxx, Xxxxx 000
Xxx
Xxxxx, XX 00000
Fax:
(000)000-0000
e-mail.
XXxxxxx@xxxxxxxxxxxxx.xxx
Notice
shall be deemed sufficient if delivered by telecopier, electronic mail, private
overnight courier service or registered or certified airmail, return receipt
requested, with postage prepaid.
h. The
parties’ respective performance hereunder is subject to force majeure, including
but not limited to wars, riots, strikes, labor disturbances, acts of God, fires,
floods, explosions, civil disturbances, inability to obtain required material
or
transportation, and acts of governmental authorities.
i. Paragraph
headings herein are for convenience only and do not control or affect the
meaning or interpretation of any terms or provisions of this Agreement.
13
j. This
Agreement (including any schedule hereto) supersedes all prior agreements and
understandings between the parties, whether written or oral, related to the
subject matter and is intended by the parties as the complete and exclusive
statement of the terms of their Agreement.
k. No
modification, addition to, or waiver of any of the terms of this Agreement
(including any schedule hereto) shall be effective unless in writing and signed
by an authorized officer of Viper. Under no circumstances shall the terms of
any
purchase order submitted by OnSat to Viper, whether before or after the
execution of this Agreement, be deemed binding upon Viper. If any of the
provisions of this Agreement are invalid under any applicable statute or rule
of
law, they are, to that extent, deemed omitted.
l. No
action to enforce any claim arising out of or in connection with the transaction
which is the subject matter of this Agreement shall be brought by either party
against the other more than three (3) years after the cause of action has
occurred.
m. This
Agreement may be executed in two or more counterparts, each of which shall
be
deemed an original, but all of which together shall constitute one and the
same
instrument. For purposes hereof, a facsimile copy of this Agreement, including
the signature pages hereto shall be deemed to be an original. Notwithstanding
the foregoing, the parties shall deliver original execution copies of this
Agreement to one another as soon as practicable following execution
thereof.
Agreed
to and accepted by:
VIPER
NETWORKS, INC.
By: ___/s/Farid
Shouekani_________
Name: ___Farid
Shouekani________
Title: ___President
- CEO_________
Agreed
to and accepted by:
ONASI,
INC.
By: ___/s/
Xxxxx
Stephens________
Name: __David
Stephens_________
Title: ___CEO_________________
14
